California drivers shopping for a new or used car will have some new protections starting October 1, 2026, thanks to a new state law aimed at making the vehicle-buying process more transparent.
The California Combating Auto Retail Scams (CARS) Act, or SB 766, introduces new rules for dealerships around advertising, pricing and certain vehicle purchases and leases.
One of the biggest changes for consumers is a new three-day right to cancel certain vehicle purchases and leases.
What is California’s new car-buying law?
The CARS Act is designed to crack down on misleading or deceptive practices in the auto-buying process and give consumers more information before they sign on the dotted line.
Starting October 1, California vehicle dealers will face new requirements concerning how they advertise and present vehicle prices, financing and lease terms.
The law applies to new and used light-duty vehicles sold or leased by California dealers, with certain exceptions.
California car buyers get a three-day cancellation period
One of the most notable changes is that qualifying buyers and lessees will have three days to cancel certain vehicle purchases or leases.
The right applies to qualifying transactions involving vehicles with a purchase or lease price of less than $50,000.
That means California consumers will have some additional time to reconsider a vehicle purchase instead of feeling like they’re locked into the deal the moment they leave the dealership.
There are exceptions and specific requirements under the law, so buyers should review the terms of their transaction carefully.
Car dealerships must be more transparent about prices
The new law also establishes additional requirements for how dealers advertise vehicles and communicate pricing.
Dealers generally cannot materially misrepresent the purchase price, financing or lease costs of a vehicle. Advertised pricing must also follow new disclosure requirements when a specific vehicle or financing terms are referenced.
For consumers, the goal is to make it easier to understand how much a vehicle actually costs before arriving at the dealership.
For anyone planning to shop for a car this fall, the new rules could make the process a little different and give qualifying buyers some additional protection after leaving the dealership.
